Ever droopier union

FALL in love, start a courtship, watch the loved one dither, pop the question just the same—and eventually get the answer yes. This should be a time of rejoicing for the ten applicant countries told this week that their long dalliance with the European Union will be over come December (see article). Instead, they could be forgiven for having second thoughts themselves. The union they are making would be more alluring if the Union they are joining were not in such a mess.

The most eye-catching part of that mess concerns the misnamed stability and growth pact, which forbids members of the euro-zone to run budget deficits of over 3% of GDP, and under which all have agreed to balance their budgets by 2004. Yet Portugal has already breached the 3% limit, France and Germany are close to it, Italy will be pushed to meet the 2004 deadline and France is heading for an official rebuke from the pact's enforcer, the European Commission. In fact, the pact would be better broken, for it could worsen a threat more serious than fiscal laxity: slow growth, or even none at all.

For this, at least some of the blame lies with the Union's last great leap forward, the single currency. One merit of the euro, it was hoped, was that by making price comparisons easy and cutting transaction costs it would serve to energise the European economy and promote structural reform. Instead, it seems to have lumbered the biggest, most sluggish and perhaps least reformed part of that economy, Germany, with interest rates higher than it needs, and also higher than those in America and Japan. With the European Central Bank still fixated on inflation, no interest-rate cut is likely soon.

To a large extent the EU's current troubles derive from the disdain its leaders have shown for their voters—look at the Nice treaty and the euro

The drive for political reform is no perkier. A constitutional convention is under way, which could help to connect the EU's citizens to its institutions by defining and delimiting the club's purpose, but may end up by imposing unpopular integration (see article) for the views of Britain's foreign secretary, Jack Straw). And the European Commission's rather modest proposals for reforming the biggest item in the EU's budget, the scandalous common agricultural policy, seem to be foundering, or at least postponed till 2006, thanks to the opposition of the biggest beneficiaries, led by France.

Unrelated to all this, but of some interest to the applicants, is the uncertainty about regional aid (another big expense), the problem of admitting a divided Cyprus, and a referendum in Ireland on October 19th. If the Irish defy their government in this vote—their second chance to approve the Nice treaty that paves the way for EU enlargement—all plans to expand the club will be thrown into confusion: the treaty must be ratified by all 15 existing members before the new, undemocratic and absurdly complicated voting system comes into effect.

To solve problems such as these, leadership is needed. Under Romano Prodi, though, the commission is weak and, more seriously, the two states that have traditionally driven the European venture in tandem are now out of step. This is particularly evident in foreign and security policy, which is meant to be the EU's next big undertaking after enlargement. France remains a warrior nation, ever critical of America but likely in the end to be won around to joint military action in, say, Iraq. Germany, always nervous these days of armed encounters, is now unambiguously opposed to any such American-led “adventure” (Chancellor Gerhard Schröder's word), UN-approved or not. To complicate matters further, Britain, Spain and Italy are openly backing the United States.

The soft centre

No matter, you may say; all this just shows the difficulty, or even impossibility, of forging a common foreign and security policy. Yet more is at stake than that. By re-electing Mr Schröder last month, the Germans have ensured that the Franco-German motor will not be driving the EU smoothly and easily over the next four years: France's President Jacques Chirac, also recently re-elected, simply does not get on with Mr Schröder as he did with Chancellor Helmut Kohl or as he would have done had Edmund Stoiber become chancellor instead.

Moreover, Germany has changed, as Mr Schröder recognised when he turned hostility to war in Iraq to his advantage in the final days of the election campaign: the German electorate, which for over half a century has in most big decisions followed the advice of its leaders against its own preferences, is no longer so willing to do so. The euro may be the last unpopular policy it will swallow. The Germans are now inclined to do what they want, and elect leaders who reflect their wishes. In foreign policy, that means not too much belligerence. In economic policy, it means not too much disruption in the name of reform. After decades of post-war hard work, Germany is prosperous. Why go to a lot of bother just to make it more so?

The implication of all this for the EU is that Germany will have to be galvanised by its popular foreign minister, Joschka Fischer, if it is to mobilise the Union. Yet in foreign policy he is unlikely to want the EU to do the sorts of things that others will want it to. And in other policies even he may find the going hard. Most Europeans have given little thought to the expansion of their club. They are already worried about jobs and immigration, and may become more so when they realise that 75m poorer newcomers are about to join. The good news is that most of those newcomers are likely to be Atlanticist, democratic and benignly nationalist: they have not thrown off the Soviet harness in order to be reshackled by Brussels.

The constitution-makers would be wise to recognise that. To a large extent the EU's current troubles derive from the disdain its leaders have shown for their voters—look at the Nice treaty and the euro. The enterprise needs both leadership and democracy if it is to sort itself out, let alone move forward.